The Philippine central bank’s latest data shows cash remittances from overseas Filipinos climbed 3.5 percent year-on-year to $3.02 billion in January, a figure economists say reflects the durability of overseas employment even as conflict in the Middle East clouds the outlook for the rest of the year.
The Bangko Sentral ng Pilipinas released the figures on Monday. January’s growth rate edged past December’s 3.3 percent, though the actual volume was 14 percent lower than the $3.52 billion recorded during the holiday-driven peak of the previous month — a pattern analysts attributed to normal post-holiday normalization.
Robert Dan Roces, group economist at SM Investments, pointed to deployment momentum from late 2025 as a key driver of January’s inflows. “The 3.5-percent year-on-year increase in January cash remittances likely reflects steady overseas employment and deployment in late 2025 that is now translating into inflows, with the weaker peso possibly encouraging more conversions into local currency early in the year,” he said. The peso hit a record low of 59.46 against the dollar on January 15.
The United States accounted for the largest share of remittances at 40.2 percent of the total, with Singapore at 7.6 percent and Saudi Arabia at 6.7 percent. Personal remittances — which include transfers through informal channels and remittances in kind — also rose 3.5 percent, reaching $3.36 billion from $3.24 billion a year earlier.
The broader concern among policymakers centers on the Middle East, where more than 2.4 million Filipinos work and which generated $6.5 billion in cash remittances in 2025, or roughly 18 percent of the national total. Over a thousand OFWs have already been repatriated from the region. Economic Planning Secretary Arsenio Balisacan told a House hearing that remittances could fall by as much as 65 percent from last year’s Middle East levels if a total deployment ban and full repatriation take effect — a scenario that could trim GDP growth by up to 0.14 percentage point this year.
Jonathan Ravelas, senior adviser at Reyes Tacandong & Co., acknowledged the risk but stopped short of a pessimistic forecast. “The pullback from December is largely seasonal after the holiday surge, but the key point is remittances are still higher than a year ago, showing OFWs’ income remains resilient,” he said. On the conflict’s longer-term effect, Ravelas added: “The Middle East conflict adds uncertainty and could cause month-to-month volatility, but unless it leads to widespread job losses or payment disruptions, full-year remittance growth should stay positive.”
Roces offered a similar assessment, noting that demand for Filipino labor remains a stabilizing factor. “Remittances should remain broadly stable in the coming months, supported by continued demand for Filipino workers abroad, although risks have risen following the recent Middle East tensions given the region’s importance as a major source of remittances,” he said.
The BSP has set a full-year cash remittance growth target of 3 percent for 2026, projecting total inflows of $36.6 billion.
